The flow-testing and sampling was undertaken by Kinetic Production & Wellhead Services, based in Roma, Queensland.

The three wells flow-tested and sampled were Primero 1, Aldinga North 1 and Reid's Dome-4. Drilled between 11 and 37 years ago, these existing wells are located within the northern half of PL 231.

The Company is pleased to report that, despite the wells being shut-in for such an extended period, all wells flowed significant gas, at lowest recorded stabilized rates of between 357,000 cf/d and 658,000 cf/d using a 0.500" orifice plate.

Two gas samples per well were taken from each of these wells and sent to Petrolab in South Australia for analysis. Gas composition results indicate the produced gas represents a similar composition in its natural form to that of pipeline-quality gas, with an average Methane (C1) content of approximately 96%, average Carbon Dioxide (CO2) content of approximately 1.5% and very low levels of interts.

The similar reservoir pressure (166 - 167psig) and gas composition results for all the wells also implies that the reservoir is connected between each of the wells tested, providing a positive indicator for future gas production.

The gas flow-testing and sampling conducted in mid-December relates to the shallow Cattle Creek Formation, which commences at approximately 130 metres from surface and does not include gas targets within the deeper Reid's Dome Beds situated beneath the Cattle Creek horizon.

The Company is also pleased to advise that the reprocessing of historical seismic survey data by DownUnder GeoSolutions is currently underway and is expected to be complete during February 2018. With the seismic re-interpretation and the recent flow-testing and gas composition results, well sites will be selected for the 2018 drilling campaign.

State Gas Limited (ASX:GAS) is a Queensland-based developer of the Reid's Dome gas field (PL 231), which includes both CSG and conventional gas, originally discovered in 1954 during oil drilling prior to the existence of a pipeline network and an east coast gas market. The Reid's Dome field is located in the Bowen Basin in Central Queensland on the apex of the Springsure-Sericold Anticline. State Gas is sole Operator and 80%-owner (transitioning to 100%) of PL 231, which is well-located 30 kilometres southwest of Rolleston, approximately 47 kilometres from the Queensland Gas Pipeline.